Article: Navigating Partnership and Shareholder Disputes: Legal Strategies and Solutions

Disputes We Handle

Our firm is well-equipped to handle a wide range of partnership and shareholder disputes, including:

• Breach of Fiduciary Duty
• Corporate Officer Self-Dealing
• Shareholder Oppression Claims
• Deadlock Disputes
• Minority Shareholder Rights Violations
• Contract Disputes
• Business Torts
• Corporate Governance and Fiduciary Duty Litigation
• Commercial Real Estate Litigation
• Employment Disputes
• Construction Litigation
• Intellectual Property Litigation

Each of these disputes requires a nuanced approach, and our experienced attorneys are committed to providing tailored legal solutions that best meet the needs of our clients.

Breach of Fiduciary Duty

Corporate officers, directors, and managers owe a fiduciary duty to their shareholders, which is the highest standard of care under U.S. law. In some cases, a controlling majority shareholder may also owe a fiduciary duty to minority shareholders. When this duty is breached—whether through negligence, fraud, or self-dealing—the offending party may be held liable for any damage sustained by the shareholders. At Perez Mayoral, P.A., we represent shareholders in claims against those who have failed in their fiduciary duties, ensuring that your rights are protected and any damages are appropriately addressed.

Corporate Officer Self-Dealing

Self-dealing occurs when a corporate insider—such as an officer or director—uses their position to advance their own interests at the expense of the corporation or partnership. This behavior can lead to significant financial harm for shareholders. Under Florida law, self-dealing is a serious violation that can result in substantial legal consequences. Our firm handles shareholder claims involving allegations of self-dealing, working to hold the responsible parties accountable and secure compensation for the affected shareholders.

Shareholder Oppression Claims

Shareholder oppression occurs when majority shareholders take actions that unfairly harm the interests of minority shareholders. This issue is particularly significant in closely held corporations, where minority shareholders may lack the ability to sell their shares to protect their investment. If you are a minority shareholder facing oppression, Perez Mayoral, P.A. can help you evaluate your case and pursue legal action to safeguard your rights and interests.

Deadlock Disputes

Deadlock disputes occur when partners or shareholders in a business cannot agree on a critical decision, leading to a stalemate that can paralyze the company. These disputes are common in smaller businesses with limited numbers of shareholders, especially when a unanimous vote is required. A deadlock can cause significant harm to the business, and resolving it often requires legal intervention. Our firm provides the necessary legal expertise to help resolve deadlock disputes, whether through negotiation, mediation, or litigation.

Minority Shareholder Rights

Minority shareholders in Florida have several important legal rights, including voting rights, inspection rights, and distribution rights. These rights are designed to protect minority shareholders from unfair treatment and ensure they have a say in the company’s operations. Perez Mayoral, P.A. is committed to defending these rights and ensuring that minority shareholders receive fair treatment in all corporate matters.

Direct vs. Derivative Shareholder Actions

Shareholders have unique rights to protect their interests and the interests of the corporation. Depending on the situation, they can file a direct action on their own behalf or a derivative action on behalf of the corporation. Direct actions address personal losses resulting from a breach of duty by corporate directors or officers, while derivative actions seek to enforce the legal duties owed to the corporation.

At Perez Mayoral, P.A., we guide shareholders through these complex legal processes, helping them choose the right course of action for their specific circumstances.

Shareholder Derivative Lawsuits

Shareholder derivative lawsuits are one of the most powerful tools available to shareholders, especially in situations where the corporation’s leadership is unwilling or unable to take action against wrongdoing within the company. These lawsuits are brought by a shareholder on behalf of the corporation to address harm that has been done to the company, often because the corporate officers or directors have failed in their duties.

Understanding Derivative Suits:

• Purpose: The primary purpose of a shareholder derivative lawsuit is to hold corporate officers or directors accountable for actions that have harmed the corporation, such as breaches of fiduciary duty, fraud, self-dealing, or corporate waste.
• Conditions: In Florida, shareholders can only bring a derivative lawsuit under specific conditions. Typically, the corporation itself must have a valid legal cause of action that it is unwilling to pursue, often due to conflicts of interest among those in leadership positions.
• Procedural Requirements: Shareholders must meet several procedural requirements to file a derivative lawsuit, including proving that they were shareholders at the time of the alleged misconduct and demonstrating that they will fairly represent the interests of the corporation.

Derivative Lawsuits in Closely Held Corporations:

• Unique Challenges: Derivative lawsuits in closely held corporations come with unique challenges and opportunities. Because these companies often have fewer shareholders and less formal governance structures, the risk of conflicts of interest is higher, making derivative suits an essential tool for minority shareholders.
• Overcoming Hurdles: In some cases, procedural hurdles, such as the demand requirement (where shareholders must first ask the board to take action), may be less stringent or waived entirely in closely held corporations, making it easier for shareholders to pursue these claims.

Our Role in Derivative Suits: At Perez Mayoral, P.A., we have experience handling shareholder derivative lawsuits. We work closely with our clients to ensure that all procedural requirements are met and that the case is presented as effectively as possible. Whether you are seeking to initiate a derivative lawsuit or defend against one, our firm is prepared to provide the skilled legal representation you need.

Representing Your Business with Integrity

At Perez Mayoral, P.A., we are dedicated to representing businesses and shareholders in a wide range of disputes. Our primary goal is to resolve these issues as efficiently and effectively as possible, always keeping your business’s success in mind. Whether you are dealing with a breach of fiduciary duty, shareholder oppression, or a complex derivative lawsuit, our experienced attorneys are here to provide the strategic guidance you need to protect your rights and achieve a favorable outcome.

If you are involved in a partnership or shareholder dispute, contact us today for a consultation. We are here to help you navigate these challenges and find the best resolution for your business.

Contact Us Today

If you’re facing a partnership or shareholder dispute or need legal guidance on any aspect of business law, reach out to us for a consultation or case review. We handle partnership and shareholder disputes throughout the state of Florida. You can contact us by emailing us at [email protected] or calling us at (305) 676-8782. Don’t navigate these complex disputes on your own—let our experienced team help you protect your interests and achieve the best possible outcome for your business.